Gary Scott Baker pleaded guilty in a fraud case related to the construction of the new United Auburn Indian Commnity school. In 2007 then-tribal chief Jessica Tavares showed off the project. Lezlie SterlingSacramento Bee Staff Photo

Gary Scott Baker pleaded guilty in a fraud case related to the construction of the new United Auburn Indian Commnity school. In 2007 then-tribal chief Jessica Tavares showed off the project. Lezlie SterlingSacramento Bee Staff Photo

Former tribal administrator pleads guilty in Auburn fraud case

Gregory Scott Baker, former administrator of the Native American tribe that owns the lucrative Thunder Valley Casino Resort in Lincoln, pleaded guilty Thursday in Sacramento federal court to his role in the theft of more than $17 million from the tribe.

Baker, 48, of Newcastle, pleaded guilty to conspiring to commit mail fraud or wire fraud, conspiring to commit money laundering, and filing a false federal income tax return for 2008. He is scheduled to be sentenced March 17.

Now a teacher in the Los Rios Community College District, Baker is charged in a 2013 grand jury indictment with participating in the scheme with Bart Wayne Volen, a general contractor and developer, and Darrell Patrick Hinz, once a contract employee of the United Auburn Indian Community hired to manage quality control and construction at an Auburn site where a Volen company was doing work on a major building project that included a school, a community center and administrative offices.

According to the indictment, Volen submitted false invoices supported by inflated cost proposals from his own general contracting firm and various subcontractors, and Baker’s duties included overseeing the project. Before any payments on project costs were authorized by the tribal council, Baker and Hinz knowingly approved the false invoices, the indictment alleges.

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Baker and Hinz, 50, of Cameron Park, were paid by Volen, 56, of San Diego and Haiku, Hawaii, for these corrupt acts that victimized the tribe, the indictment states.

The massive rip-off was carried out over about 14 months in 2006 and 2007, the indictment says, adding that the trio continued to launder their ill-gotten gains into June 2009.

One series of events described in the indictment shows one way the three men drained money out of the tribe’s coffers and lived well on the stolen proceeds: Hinz sent a number of fraudulent invoices to Volen, ostensibly for consulting work, and Volen sent Hinz 29 checks totaling about $7.5 million. From the loot, Hinz paid for a Baker trip to Hawaii, retired some of Baker’s financial obligations, bought him a $70,000 BMW and a mobile home, financed Baker property investments, bought him a vacation condominium at Lake Tahoe and a $54,000 swimming pool at his primary residence, all to the tune of more than $1.4 million.

Baker’s plea agreement must be approved by the judge. If the judge does not approve it at the sentencing, the defendant has the right to withdraw the plea. Prosecutors have agreed to recommend a 6 1/2-year prison sentence for Baker, but it could go lower if prosecutors deem the assistance he has promised them has been substantial.

Baker attorney Tom Johnson told the judge his client was cooperating with the government.

On the motion of Assistant U.S. Attorney Michael Beckwith, U.S. District Judge Troy L. Nunley ordered the Baker plea agreement sealed because of Baker’s cooperation agreement. He will testify against Hinz if Hinz goes to trial, but what other assistance he may be to the prosecutors is not clear. Hinz is the only one of the three defendants who has not pleaded guilty.

Outside the courtroom after the hearing, Johnson told a reporter that he does not oppose public access to the plea agreement.

Attached to every written plea agreement is a factual basis that can run to a half-dozen pages or more and is signed by the defendant. It details the activities the defendant is admitting, thus offering valuable insight into the alleged crimes.

Cooperation is a major factor when it comes to sentencing, and many times it is not necessary for a cooperator to testify in open court. If it is unknown publicly that a defendant has assisted the government in return for leniency, the public does not know what motivated the plea and has no insight into a reduced sentence.

Editor’s note (Nov. 6): This story has been corrected. Baker attorney Tom Johnson said he does not oppose public access to the plea agreement.